Employee benefits in Luxembourg: 13th salary, severance pay and compensations
In Luxembourg, during a job contract, employers must follow the law to provide several benefits for their workers. This includes things like paid vacation, extra pay for overtime work, time off for new moms and dads, and severance pay if the job ends, plus more.
Luxembourg is known as one of Europe's top places to live, offering a great quality of life and good working benefits for its employees. People working here usually have better conditions than in other countries. For example, the pension system is impressive – you only need to contribute for 10 years to be eligible for a pension.
Different types of workers' remuneration and bonuses in Luxembourg
Luxembourg offers diverse forms of remuneration, bonuses, and benefits for its workforce. While these entitlements are universal, each comes with distinct conditions. In the upcoming sections, we will intricately examine each benefit that Luxembourgish workers are entitled to, elucidating the specific conditions associated with each.
What if you work with yourself?
It's crucial to note that these provisions apply to employees working in Luxembourg and do not extend to independent workers.
Learn more about self-employment in Luxembourg
Overtime payment
In Luxembourg, the standard working hours are set at 8 hours per day and 40 hours per week. For any work beyond this agreed-upon standard, employees are entitled to compensation in the form of overtime pay.
However, there is a maximum limit of 2 hours per day and 8 hours per week for overtime.
The overtime benefit is for all private sector workers, except for top bosses, who work more hours than their job contracts say. However, some workers don't get this overtime benefit and don't follow the usual work-hour rules. This includes family-run businesses with only family employees, river transport companies, businesses that move around, people working from home, sales reps who work away from the office, and high-up managers or executives who are crucial for running and overseeing the company.
Overtime hours worked must be compensated with paid time off, with a rest period of one and a half hours for each overtime hour worked. If, due to organizational reasons, it is not feasible to compensate the overtime hours through time off, or if the employee leaves the company before recovering the worked overtime hours, these hours must be paid at a rate of 140%.
For further details and legal references, you can refer to the related de page on Guichet.lu and the Labor Code, Book II, Title I.
Annual paid leave
In Luxembourg, workers are entitled to annual paid leave lasting a minimum of 26 working days, with the possibility of additional days granted by employers or collective agreements. However, specific conditions govern this benefit, and we will examine them in detail.
All employees, including apprentices, irrespective of their work schedule, be it part-time, full-time, or other arrangements, and regardless of the contract type, whether fixed-term or indefinite, have the right to annual paid leave. It's important to note that for part-time employees, vacation days are calculated proportionally based on their weekly working hours.
Unless otherwise agreed by the employer, new employees must work continuously for at least 3 months before being eligible for the accrued paid leave since the start of their contract. Additionally, it is crucial to understand that engaging in paid work during vacation is not permitted, and employees cannot waive their entitled vacation, even in exchange for compensation, unless the employment relationship is terminated.
The legal duration of annual leave is 26 working days per year, accumulating at a rate of 2.167 days per month worked.
Certain categories of workers automatically receive additional days:
- Disabled workers, war invalids, and those who have experienced a workplace accident have 6 paid working days per year covered by the State.
- Employees in mines and quarries have 3 additional paid working days per year.
- Workers unable to enjoy an uninterrupted rest period of 44 weekly hours have 1 extra day off for every 8 weeks, consecutive or not, in which they haven't had continuous rest.
For further details and legal references, please consult the related page on Guichet.lu, the Labor Code - Book II, Title III, Chapter III, and the Labor Code - Book III, Title IV, Chapter IV.
Weekend and holiday work compensation
All workers and apprentices in Luxembourg enjoy the right to legal public holidays. While the premise is straightforward, with 11 legal holidays, important nuances exist, such as working on holidays due to specific company conditions or holidays falling on weekends.
- New Year's Day (January 1)
- Easter Monday
- Labor Day (May 1)
- Europe Day
- Ascension Day
- Whit Monday
- National Day (public celebration of the Grand Duke's birthday on June 23)
- Assumption Day (August 15)
- All Saints' Day (November 1)
- Christmas Day (December 25)
- 2nd Christmas Day (December 26)
Every worker and apprentice is entitled to legal public holidays. However, employers may request employees to work on holidays in exchange for additional compensation.
Typically, employees do not work on public holidays. However, if an employee was not scheduled to work on the holiday or if the holiday falls on a Sunday, he is entitled to compensation.
When employees are required to work on public holidays, they are entitled to specific compensation based on the day of the week and their normal working hours.
For further details and legal references, consult the relevant page on Guichet.lu, the Labor Code - Book II, Title I, Chapter I, the Labor Code - Book II, Title III, Chapter II, and the Labor Code - Book III, Title IV, Chapter IV.
Take a look at our holidays calendar for 2024
Sick leave
Luxembourgish workers are entitled to take days off from work in the event of incapacity due to illness or accidents. However, justifying their absence and meeting specific requirements are essential.
All employees unable to attend work due to illness or accidents have the right to sick leave days, provided they declare their incapacity through a medical certificate.
From the first day of absence, it is mandatory to inform the employer, either by phone or in writing. If the employee cannot do so personally, a third party may communicate on their behalf. Additionally, in the case of an absence exceeding 2 working days, a medical certificate of incapacity must be sent to both the employer and the CNS (National Health Fund). The employer reserves the right to request this certificate from the first day of absence.
Sick leave is not akin to a free day where one can engage in unrestricted activities. There are limitations on leaving the house during illness. For the first 5 days of incapacity, is not possible to leave the residence, even if authorized by a medical professional. After this initial period, it’s possible to leave the home from 10:00 to 12:00 and from 14:00 to 18:00. Necessary visits to the doctor or any healthcare facility are permitted at any time from the first day of incapacity.
Throughout the sick leave period, employees are entitled to continued remuneration from the employer until the end of the month in which the 77th day of incapacity occurs. Beyond this date, employees still have the right to a subsidy, but it is provided by the CNS.
For further details and legal references, consult the dedicated page on Guichet.lu, the Labor Code - Book I, Title II, Chapter I - Section 4, the Social Security Code - Book I, Chapter II, and the Statutes of the Caisse Nationale de Santé (CNS).
Maternity leave
In Luxembourg, every pregnant woman working is entitled to maternity leave, comprising both prenatal and postnatal periods. This provision not only safeguards the health of expecting mothers but also allows them dedicated time to care for their newborns. Throughout pregnancy and maternity, female employees benefit from specific contractual guarantees and adjustments to their working conditions.
Support for mothers
Pregnant women has protection against dismissal from the onset of pregnancy, special health and safety protection in roles with specific risks, exemption from night work risks, leave for prenatal examinations, and several weeks of leave both before and after childbirth. Flexible schedules for breastfeeding are also part of the supportive measures.
To obtain these benefits, certain conditions must be met.
Prior pregnancy notification
Maternity leave application
The prenatal leave begins eight weeks before the anticipated delivery date, and postnatal leave extends for 12 weeks from the actual delivery date. In total, pregnant women are entitled to 20 weeks of maternity leave.
During job interviews, pregnant women are not obliged to disclose their pregnancy, as it is considered a private matter. Additionally, expecting or lactating women are entitled to various protective measures. For a detailed list, we recommend you take a look at the government's explanatory text on the Protection of Pregnant or Breastfeeding Women.
Throughout maternity leave, women are entitled to maternity benefits paid by the CNS, not the employer. This benefit corresponds to the highest salary received in the three months before maternity leave. The maternity pay cannot fall below the monthly minimum social wage nor exceed five times the monthly minimum social wage.
For further details and legal references, consult our detailed article about this subject, the dedicated page on Guichet.lu, the Labor Code - Book III, Title III, the Social Security Code, and the Statutes of the Caisse Nationale de Santé (CNS).
Paternity leave
Paternity leave is a special allowance of 10 days granted to working fathers upon the birth of a child or the adoption of a child under 16. Below, we outline the conditions for accessing this leave.
To be eligible for paternity leave, it is necessary to submit a medical certificate for childbirth or supporting documentation for adoption at least 2 months before the anticipated dates for taking the leave.
For workers with a standard 40-hour workweek, paternity leave corresponds to 80 hours, which can be taken in a fragmented manner. For those with a workweek of less than 40 hours, the leave hours are proportional to the established weekly working hours in the employment contract. In the absence of an agreement between the worker and the employer regarding the days of leave, the paternity leave must be taken at once and immediately following the birth or adoption.
For further details and legal references, refer to the dedicated page on Guichet.lu and the Labor Code - Book II, Title III, Chapter III.
Severance pay in Luxembourg
When an employer dismisses a worker for reasons other than serious misconduct, a notice period is mandatory. If the employee has been with the company for 5 years or more, they are entitled to an extended notice period and severance pay.
Length of service (years) | Severance pay (months) | Notice (months) | Extended notice without severance pay (months) |
Less than 5 | 0 | 2 | 0 |
5 to 9 | 1 | 4 | 5 |
10 to 14 | 2 | 6 | 8 |
15 to 19 | 3 | 6 | 9 |
20 to 24 | 6 | 6 | 12 |
25 to 29 | 9 | 6 | 15 |
More than 30 | 12 | 6 | 18 |
For small companies
However, companies with fewer than 20 employees have the option to substitute severance pay with an extension of the dismissed worker's notice period. The employer must explicitly state this choice in the dismissal letter.
The severance pay amount is contingent on the employee's tenure at the expiration of the notice period. For further details and legal references, consult the dedicated page on Guichet.lu, the Labor Code - Book I, Title II, Chapter IV, and the Labor Code - Book IV, Title I.
13th salary and non-compulsory benefits in Luxembourg
In addition to the mandatory benefits we've outlined, employers in Luxembourg also have the option to provide certain non-compulsory benefits, allowing for flexibility in enhancing the overall employee experience.
How to obtain benefits and compensation?
Usually, to get benefits and compensation in Luxembourg, you just need to qualify for them. This means meeting certain requirements, like how long you've been with the company or specific aspects of your job or situation. For instance, to get maternity leave, you have to show you're eligible with the right paperwork. For many other benefits, simply talking to the right person in your company can help, whether that's your manager or someone from HR. They'll help you with any forms you need to fill out and guide you through the process to get your benefit.
What to do in case your employer is escaping paying benefits?
If you believe that your labor rights are being violated in Luxembourg, you should promptly reach out to the supporting authority.
The Inspectorate of Labor and Mines in Luxembourg (ITM) play a crucial role in safeguarding employees' rights and ensuring compliance with labor laws. By reporting problems to this regulatory body, you will obtain guidance, resolution, and enforcement of your rights.
Located 500m from the CHL (Centre Hospitalier de Luxembourg)
Frequently Asked Questions (FAQ)
What are the conditions for qualifying for severance pay in Luxembourg?
Do fathers have paternity leave in Luxembourg?
How is sick leave handled, and what documentation is needed?
Source: www.usemultiplier.com, guichet.public.lu, guichet.public.lu, guichet.public.lu, guichet.public.lu, www.justarrived.lu, guichet.public.lu, guichet.public.lu, guichet.public.lu, guichet.public.lu
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